If a company is sustainable, it can operate for a long time without causing problems that will, in turn, affect it later. Therefore, a sustainable portfolio usually comprises such long-term-oriented businesses. The sustainability challenges are increasingly drawing the attention of many investors worldwide, from the climate crisis to pandemics and other vulnerabilities calling for urgent action.  

Therefore, investors with a general desire to do something more sustainable to their investment portfolios must be sure where they should focus their energies. 

Below is advice on how to implement and manage sustainability portfolio.

Find Out What Sustainable Investing Means to You

As with any financial planning, establishing your goals at the outset is essential, including how you see environmental, social, and governance (ESG) factors fitting into your portfolio. There are three common ESG awareness levels among the majority of investors. The ESG is unaware and aware, and the ESG motivated investors. When you are a highly ESG-motivated investor, you will likely unpack your specific interests and preferences in your sustainable portfolios.

Understand What is In Your Current Portfolio

You need to ask yourself various questions to determine the sustainability of your investment portfolio. These questions include the intentional attributes whereby you consider if your investment portfolio prefers funds designed with ESG goals in mind or if you also accept funds that unintentionally have ESG qualities. You also need to assess the ESG risks if the financial supporting ESG risk is relative to its industry peers. You must also consider the ESG commitment levels and the climate impact.

Know The Sustainable Options That Are Available for You

Now that you have dissected the sustainability of your portfolio and identified your priorities, the next thing is to begin making adjustments to ensure that you have fully sustainable portfolios. For instance, you may need to do exclusionary screening to eliminate all the bad from your investment portfolio. You could also hire a middle office to manage your portfolio and other assets to make sure that everything is in check.

As you know, not all sustainable investment funds would apply the same level of exclusion in determining investable opportunities.  Some reasons you may need to apply exclusionary screening are to be specific on morals and ethics, access the financial materiality, and the regulatory environments. Other than avoiding the problematic funds, you can also emphasize the good by choosing only those companies that bring good. An example of such funds is the active equity funds.

Have A Plan to Transition Your Portfolio

After all, you have determined your sustainable investing strategies; now, the next thing is to start transitioning your portfolio. You must be very keen on this process as several competing investment options exist. However, you should keep in mind your ESG level of intensity, your ESG profile in the existing portfolio, your return objectives and overall risk, and the tax consequences for any reallocation of capital.


To create and manage a sustainable portfolio, you need to find out what sustainable investing means and understand your current portfolio. Know the sustainable investment options that are available for you and have a plan to transition your portfolio.